American Express Profit Tops Estimate

(RTTNews) - American Express Co (AXP) on Wednesday reported a higher fourth-quarter profit, driven mainly by a gain from the sale of its investment in Concur Technologies, as well as higher card member spending and net interest income, partly offset by loan-loss provision and expenses.

"We've made very good progress against the backdrop of an uneven global economy and the negative impact of a strengthening U.S. dollar. We see many opportunities for growth, but at the same time, we face competitive and regulatory challenges," said CEO Kenneth Chenault.

Following the announcement, American Express shares slipped over 2 percent in after-hours trade on the New York Stock Exchange.

American Express, based in New York, posted quarterly net income to stockholders of $1.44 billion or $1.39 per share, compared with $1.3 billion or $1.21 per share last year.

On average, 28 analysts polled by Thomson Reuters expected earnings of $1.38 per share for the quarter. Analysts' estimates typically exclude special items.

Fourth-quarter revenues, net of interest expense, rose 7 percent to $9.11 billion from $8.55 billion in the prior-year quarter. Twenty-two analysts had a consensus revenue estimate of $8.53 billion for the quarter.

Revenue in the company's U.S. card services segment rose 5 percent, while international card services revenue fell 5 percent.

Revenue at its global commercial services segment jumped 28 percent, mainly reflecting a gain of $719 million on the sale of the company's investment in Concur Technologies. Global network and merchant services revenue rose 2 percent.

American Express' fourth-quarter card member spending rose 6 percent., and loan balances were up 7 percent in the U.S.

Meanwhile provisions for loan losses rose 22 percent from last year to $582 million, reflecting a build in reserves.

Expenses were up 3 percent to $6.3 billion, compared with a year ago.

AXP closed Wednesday at $87.67, up $0.41 or 0.47%, on a volume of 7 million shares on the NYSE. In after hours, the stock dropped $1.92 or 2.19% at $85.75.